The move will see the England international team up once again with former Chelsea manager Jose Mourinho, who replaced Roberto Mancini as Inter coach earlier this month.

France Football said Lampard, who joined Chelsea from West Ham for £11 million in 2001 when Claudio Ranieri was manager, will earn an annual salary of around £5.8 million.

Lampard was one of Mourinho's 'untouchables' at Stamford Bridge and his goals from midfield contributed largely to the club's back-to-back Premier League title successes in the 2004-05 and 2005-06 seasons.

He has scored more than 20 goals in his past three seasons at Chelsea.

Lampard demonstrated great courage when he stepped up to take a penalty in last season's Champions League semi-final against Liverpool shortly after the death of his mother. He scored from the spot and Chelsea went on to reach the final for the first time in their history.

Lampard scored the equaliser for Chelsea in the final which ended 1-1 after extra time, but Manchester United went on to win the match on penalties.

Although Lampard was a hugely influential player at Chelsea, he sometimes failed to shine when partnered in midfield with German international Michael Ballack as both players like to get into the penalty box and score goals.

Specualtion will inevitably increase as to who will replace Lampard, with Portuguese midfielder Deco being touted as one of Luiz Felipe Scolari's main transfer targets.

Deco currently plays for Barcelona but is said to be surplus to requirements at the Nou Camp.